Question
You in vest #980.10 in a compound interest account that earns 2.5% per annum Compounded daily for 10 months. What amount do you have after 10 months
Answers
GPT 3.5
To calculate the final amount after 10 months in a compound interest account, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the amount of money accumulated after n months, including interest
P = the principal amount (initial investment) = $980.10
r = annual interest rate = 2.5% or 0.025
n = number of times interest is compounded per year = 365 (since it is compounded daily)
t = time the money is invested for = 10 months = 10/12 years
Plugging in the values:
A = 980.10(1 + 0.025/365)^(365*(10/12))
A = 980.10(1 + 0.00006849315)^(365*(10/12))
A = 980.10(1.00006849315)^3.0833
A = 980.10 * 1.208253
A = $1185.74
Therefore, after 10 months, you would have approximately $1185.74 in the compound interest account.
A = P(1 + r/n)^(nt)
Where:
A = the amount of money accumulated after n months, including interest
P = the principal amount (initial investment) = $980.10
r = annual interest rate = 2.5% or 0.025
n = number of times interest is compounded per year = 365 (since it is compounded daily)
t = time the money is invested for = 10 months = 10/12 years
Plugging in the values:
A = 980.10(1 + 0.025/365)^(365*(10/12))
A = 980.10(1 + 0.00006849315)^(365*(10/12))
A = 980.10(1.00006849315)^3.0833
A = 980.10 * 1.208253
A = $1185.74
Therefore, after 10 months, you would have approximately $1185.74 in the compound interest account.